Azure Power Wins 250 Megawatt Solar Project In India At Record Tariff

An auctioned organized by India’s largest power generating company, NTPC Limited, yielded the lowest-ever tariff for a solar project obligated to use Indian-made solar modules.

NYSE-listed Azure Power secured the bid to set up a 250 megawatt solar power project at a tariff of Rs 3.14/kWh (4.8¢/kWh). Several other developers participated in the auction with bids ranging between Rs 3.14/kWh (4.8¢/kWh) to Rs 4.95/kWh (7.6¢/kWh). Interestingly, this was the first time ever that a foreign module manufacturer had participated in the auction that requires developers to use only Indian-made modules. Canadian Solar Holdings had offered to set up 100 megawatts.

Waaree Energies and Adani Green Energy had also participated in the auction albeit unsuccessfully; both the companies own substantial solar cell and module manufacturing facilities in India.

The last auction that mandated Domestic Content Requirement (DCR) was secured by Tata Power Solar at a tariff of Rs 4.84/kWh (7.4¢/kWh). The power purchase agreement for the project was signed in December 2016. The latest auction, thus, marks a huge correction of 35% from the previous auction.

Azure Power is one of the leading solar power developers in India with a portfolio of more than 1.6 gigawatts. With the latest auction the company will now be the largest supplier of electricity to NTPC Limited and its subsidiary NVVN Limited.

The company also recently raised Rs 200 crore ($30.5 million) in debt funding from Dutch development agency FMO. The funds will be used for setting up 300 megawatts of capacity currently under construction. It also raised $500 million through green bonds issue earlier this year. With an interest yield of 5.5% for the issue, investors had offered to invest over $1 billion.